India Ethanol Market Will Grow At Highest Pace Owing To Increasing Government Support For Biofuels

The India Ethanol market comprises manufacturing of ethanol for applications in transportation fuel, alcoholic beverages and industrial solvents. Ethanol is majorly derived from sugarcane molasses and grain. It offers advantages such as clean burning properties, domestic production reducing oil imports and higher octane rating compared to petrol. Growing demand for eco-friendly fuel in automobiles especially with new E20 blending program by government driving ethanol consumption in transportation sector.

The Global India Ethanol Market Size Is Estimated To Be Valued At US$ 2.43 Bn In 2024 And Is Expected To Exhibit A CAGR Of 15.% Over The Forecast Period 2024-2031.

Key Takeaways

Key players operating in the India Ethanol are Piccadily Sugar Allied Industries Ltd., Thiru Arooran Sugars Ltd., Ugar Sugar Works Ltd., Dhampure Speciality Sugars Ltd., Praj Industries, Triveni Engineering Industries Ltd, E.I.D. Parry (India) Ltd., DCM Shriram Ltd., Mawana Sugars Ltd., Uttam Sugar Mills Ltd., Kothari Sugars And Chemicals Ltd., Avadh Sugar Energy Ltd., The Ugar Sugar Works Ltd., Dwarikesh Sugar Industries Ltd., K.M.Sugar Mills Ltd., Shree Renuka Sugars, Balrampur Chini Mills Ltd., Bajaj Hindusthan Sugar Ltd., Dalmia Bharat Sugar and Industries Ltd., Dhampur Sugar Mills Ltd.The ethanol demand is growing in transportation fuel segment owing to government blending targets. Technological developments such as 2G 3G technology facilitating ethanol production from agri residues and municipal solid waste supporting capacity additions.

Market Trends

The Indian government has targeted 20% ethanol blending with petrol by 2025 which is driving capacity expansions by industry players. Introduction of BSVI standards from 2020 requiring cleaner burning fuels further boosting ethanol adoption. Another trend is use of advanced technologies like enzymatic process and continuous fermentation enabling lower production cost and waste utilization.

Market Opportunities

Rising agricultural waste in India offer opportunities for second generation ethanol production leveraging technologies like enzymatic hydrolysis. Government schemes on setting up bulk drug and ethanol plants in aspirational districts will attract investment in boosting domestic supply chain. Collaboration with public sector OMCs for long term off-take agreements ensuring revenue visibility for ethanol makers.

India Ethanol Market Outlook

The COVID-19 pandemic has significantly impacted the growth of India's ethanol market in both pre-COVID and post-COVID times. During the pre-COVID times, the market was growing at a robust rate of over 15% annually due to various government initiatives promoting ethanol blending with petrol. However, during 2020 and 2021, the lockdowns imposed to control the spread of the virus adversely impacted fuel demand and disrupted supply chains. As a result, ethanol production and consumption declined sharply.

However, the government maintained its focus on ethanol blending during the pandemic. Several waivers and relaxations were announced to support ethanol producers. New infrastructure was also built to bolster ethanol supply. As the pandemic situation improved from late-2021, fuel demand started recovering steadily. The government upped the blending ratio mandate from 5% to 20% by 2025 which will further boost ethanol demand. Though uncertainty remains around future COVID waves, the long-term outlook for the market is positive given the firm government commitment. Producers are now focusing on capacity expansions and new technologies to capitalize on this opportunity.

In terms of geography, India's ethanol market is currently concentrated in regions with surplus sugar production like Maharashtra, Karnataka, Uttar Pradesh and Gujarat. Maharashtra alone contributes over 40% of total ethanol supplies due to large sugarcane belts. However, states in central and eastern India like Bihar, Jharkhand and Chhattisgarh are expected to witness fastest growth in the coming years. This is because of initiatives to develop new distilleries and provide transport subsidies in these regions to achieve 20% blending targets. Diversifying ethanol sources nationwide will help reduce India's massive crude oil imports.

What are the key data covered in this Global India Ethanol Market report?

:- Market CAGR throughout the predicted period

:- Comprehensive information on the aspects that will drive the Global India Ethanol Market's growth between 2024 and 2031.

:- Accurate calculation of the size of the Global India Ethanol Market and its contribution to the market, with emphasis on the parent market

:- Realistic forecasts of future trends and changes in consumer behavior

:- Global India Ethanol Market Industry Growth in North America, APAC, Europe, South America, the Middle East, and Africa

:- A complete examination of the market's competitive landscape, as well as extensive information on vendors

:- Detailed examination of the factors that will impede the expansion of Global India Ethanol Market vendors

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